Tag: National Statement of Expectations for Supported Housing

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Policy

The Problems with Exempt Accommodation

problems with exempt accommodation
problems with exempt accommodation

Background

Back in 2005 the primary revenue funding stream for supported housing was “Supporting People funding”, a £1.8 billion UK wide funding pot that had been rolled out two years earlier but was already retrenching markedly. Supported housing providers were struggling to cope with revenue reductions after having been encouraged to grow their services by the government of the day, which then immediately set about restricting the Supporting People revenue upon which those schemes depended.

It was at that time that I and a few others identified a means of offsetting some of that revenue loss. We identified the existence of the Exempt Accommodation rules, an arcane set of regulations that entitled agencies that complied with them to claim enhanced levels of Housing Benefit for providing certain housing related services to people with additional needs. I reinvented the term “intensive housing management” to describe those services and set about promoting the Exempt Accommodation rules, enhanced Housing Benefit, and intensive housing management to the supported housing sector. Over 15 years later, enhanced Housing Benefit has become the primary funding stream for supported housing totalling around £1 billion per year.

Problems?

I hope you’ll forgive me for taking pride in having been instrumental in creating that £1 billion revenue pot. However, in addition to a sense of pride I also have a sense of intense anger at the fact that the Exempt Accommodation rules have been roundly abused by organisations and individuals that have made massive amounts of money, and still do, through the wholesale financial abuse of people with additional needs.

Housing Benefit, whether enhanced or not, is a personal benefit. This personal benefit is being diverted into the pockets of dubiously motivated people on an industrial scale.

To qualify your tenants for enhanced Housing Benefit you must be an “exempt landlord”: put simply; a “housing association”, a charity or voluntary organisation.

The Exempt Accommodation rules were devised in 1996 to prevent ill motivated private landlords from robbing the Housing Benefit system by providing poor quality bed-and-breakfast accommodation to homeless people and charging the local authority a fortune for it. The government of the day introduced the Exempt Accommodation rules to restrict private landlords to Local Reference Rent levels (now known as Local Housing Allowance). Certain landlords, identified above, were exempt from those rent levels, so exempt landlords could claim enhanced levels of Housing Benefit.

What has happened since enhanced Housing Benefit became a major revenue stream is that certain individuals have abused the system by setting up allegedly exempt landlord structures, which are nothing more than badly motivated private businesses masquerading as exempt accommodation compliant supported housing providers.

These businesses are exploiting the Exempt Accommodation rules to use them for the very opposite purpose for which they were intended, which was to prevent, not enable, the abuse of peoples’ Housing Benefit entitlements.

But it’s not just dubious supported housing providers, which milk the system and provide poor quality accommodation and minimal or non-existent services that are the problem. Commercial greed has affected the entire supported housing ecosystem.

Private Capital

Don’t get me wrong here; I absolutely believe that private capital is essential for the development of new supported housing schemes. Whether you fund supported housing, commission supported housing, deliver it, or measure its quality you need to do so according to a set of principles. A few years ago, I devised “Value Generation” as this set of principles:

  • Outcomes for people (qualitatively measured)
  • Cost benefit to the public purse (quantitatively measured)
  • Wider social and community benefit (qualitatively and quantitatively measured)

So, if you don’t generate value you shouldn’t be involved in supported housing.

Just as many supported housing providers do a brilliant job for people with additional needs, some private capital providers do the same thing. To get an idea of what I mean you could do worse than to book onto our free virtual supported housing conference 2022. One of the sessions will be led by Assetz Exchange, which acquires and leases property for supported housing and whose investors can expect a yield of in the region of 5%, which is entirely reasonable and is an exercise in Value Generation.

By comparison, I’m aware of other private capital providers who think that 9%, 10%, 12% or 15% yields are reasonable and some of which would think nothing of using dubious valuation methodologies as a means of inflating the property lease cost for enhanced Housing Benefit claim purposes. Often the only value being generated in such examples is financial value to investors and shareholders at the expense of services for people with additional needs, who are supposed to be the point of and the priority for supported housing.

The Invasion of the Supported Housing Ecosystem & the Response to it

Many of the money motivated private capital providers have made common cause with equally money motivated registered providers, which in turn work with supported housing provider agencies that take on the identity of CICs and other allegedly non-profit structures.

This has led to an invasion of the supported housing ecosystem by people and organisations who know how to play the system for financial gain.

This influx of the uninvited has led to significant pressure on local authorities and enhanced Housing Benefit. Alleged supported housing providers, whether connected to dubiously motivated private capital or not, have popped up all over the place, usually in the form of a CIC, and demanded enhanced Housing Benefit for alleged supported housing services that no one asked them to provide.

One of the consequences of this is the National Statement of Expectations for Supported Housing, published by the UK government (England only) in October 2020, which tells local authorities to restrict the number of new supported housing “market entrants”, to restrict the payment of enhanced Housing Benefit (without actually using those words) and exhorts commissioners and revenues and benefits teams to work together in the administration of enhanced Housing Benefit.

“Inside Housing” magazine continues to run an information campaign on the uncontrolled growth of exempt accommodation. Thea Raisbeck on behalf of Commonweal Housing and Spring Housing published “Exempt From Responsibility?“, which focuses in particular on Birmingham; an outlier in exempt accommodation abuse with 22,000 exempt accommodation bed spaces. Many of these are in poor quality housing within which negligible or no services are provided, but which attract high levels of enhanced Housing Benefit. Where does that money go, I wonder?

But it’s not just Birmingham, bad though the situation is there. The MHCLG (now the DLUHC) set up five exempt accommodation pilots in Birmingham, Hull, Bristol, Blackburn and Blackpool all of which are exempt accommodation “hotspots”. Those pilots recently reported.

The “Supported Housing Oversight Pilots” evaluation report is heavily qualified methodologically and contains a plea for more funding for further evaluation. This wish appears to have been partially met by the UK government’s recent announcement of £20m towards a Supported Housing Improvement Programme.

The report recommends that “care, support and supervision” (an Exempt Accommodation rule criterion) should be defined and that regulations around rent levels and subsidy rules should be reviewed. The temptation to use this as a means of exercising cost control rather than Value Generation must be resisted. It might sound a bit “old hat” of me to say that investment in preventative services such as supported housing saves a fortune in otherwise avoidable statutory interventions, but it’s still true. The point should be to deny revenue to dodgy operators, not restrict revenue to good ones.

The report also reflects the National Statement of Expectations for Supported Housing in saying that local authorities should be able to intervene to stop new supported housing supply where it is unnecessary or of poor quality. Many local authorities have set up “gateway” arrangements which prospective supported housing providers have to go through, rather than just setting up and applying for enhanced Housing Benefit.

Rather confusingly, the report claims that “local authorities’ oversight of support is currently limited by existing regulation….”. It seems to me that there is a distinct difference between regulation on the one hand (and the supported housing sector has several regulators) and oversight on the other, which pretty much doesn’t exist. In my view, ALL supported housing providers should be subject to local accreditation as they were during the Supporting People initiative. No accreditation should mean no funding.

Oversight should be based on an independently developed and implemented oversight system based on Value Generation principles.

Given the prominence of some registered providers in what has become the exempt accommodation industry, the Regulator of Social Housing (RSH) in England has sanctioned several exempt accommodation registered providers. The modus operandi of some of those registered providers is to use associated private companies to charge large amounts of money often for unspecified services to supported housing providers (both good and bad) that work as their agents. Let’s do the maths here; if for example, a registered provider has 5000 agency managed bed spaces and an associated private company charges 10% of the rent roll to those agencies (for unspecified services that may not be provided), given an average weekly enhanced Housing Benefit charge of, say, £200 a week, it’s making £5.2 million per year. Where is this money going?

Thus far the RSH has claimed it has no control over third party organisations associated with registered providers, even in circumstances of apparent “disguised profit”. However, that is about to change as a consequence of legislative changes to sections 107, 108, 203 and 208 of the Housing and Regeneration Act 2008, which will give the RSH “look through” powers to demand that registered providers explain where money that has left the regulated sector has gone, and not before time.

The UK government DLUHC is currently conducting an Inquiry into Exempt Accommodation. You can see my submission to that enquiry here. The thrust of my submission is that Exempt Accommodation as a concept should be abolished, that enhanced Housing Benefit should be abolished and replaced with “Supported Housing Rent“, which is an uncapped housing component of Universal Credit, that all supported housing providers should be accredited at local level (as they were under “Supporting People”) and that there should be an independent oversight system for Supported Housing  based on Value Generation principles.

At time of writing the Inquiry is ongoing, but we will be updating you on any progress it makes at our supported housing conference 2022 which, I repeat, is a free event. At time of writing, we have 800 bookings across the six separate components of the conference.

The Exempt Accommodation Project.

One of the serious implications of the abuse of the Exempt Accommodation rules and enhanced Housing Benefit is that local authorities have, in many cases, implemented quite stringent interpretations of the National Statement of Expectations for Supported Housing by making it much harder for supported housing providers to claim enhanced Housing Benefit. I can quite understand their position, but it affects genuine supported housing providers as well as their dubious counterparts.

In addition to making it harder to claim enhanced Housing Benefit, some local authorities have told supported housing providers to register as registered providers. This is because where a registered provider is the landlord a local authority can recover from the DWP all the enhanced Housing Benefit it pays. Where a charity or voluntary organisations the landlord in an exempt accommodation/enhanced Housing Benefit claim, the local authority can only recover 60% of the difference between the Local Housing Allowance rate and the amount of the claim, so the local authority will lose a lot of money if it pays the claim.

However, the RSH has an effective embargo on registering new supported housing registered providers, again due to the conduct of those wrongly motivated supported housing registered providers, many of which have been sanctioned by the RSH.

Our solution to this is the Exempt Accommodation Project, which brokers relationships between reputable supported housing providers and reputable registered providers to enable local authorities to pay reasonable, well-founded enhanced Housing Benefit claims without loss of subsidy.

Talk To Us

If you represent a reputable supported housing provider struggling to claim enhanced Housing Benefit, or a reputable registered provider willing to take a short-term lease on a supported housing provider’s property for a good revenue stream please contact us.

Finally, if you’re looking for values driven professional consultancy advice and support in supported housing, please get in touch.

Categories
Finance & Funding Policy

Enhanced Housing Benefit, the Exempt Accommodation Project and the Oversight of Supported Housing

supported housing head image

Introduction

Some months ago, I wrote a briefing on the oversight of supported housing. Since then, much has happened in the supported housing space, including the National Statement of Expectations for Supported Housing and consequential structural changes at local authority level. These changes include more integrated “commissioning” of supported housing, often in conjunction with Revenues and Benefits departments, as local authorities consider how to manage the supported housing “market”.

Enhanced Housing Benefit and the Exempt Accommodation Rules

We have seen additional restrictions on, and greater scrutiny of enhanced Housing Benefit claims made by supported housing providers under the Exempt Accommodation rules.

Back in October 2020 I wrote a briefing on the National Statement of Expectations for Supported Housing in which I expressed concern that it would be used as an exercise in cost control. Unfortunately, those fears seem to be justified in many instances. Some local authorities are trying to insist on supported housing providers becoming registered providers to qualify for framework agreements and tenders in circumstances where, in England at least, this is a very difficult thing to do.

Other local authorities are restricting enhanced Housing Benefit payments to non-registered supported housing providers to artificial local maxima of less than they need and are entitled to. They do this to avoid the subsidy loss they incur when they pay enhanced Housing Benefit to non-registered supported housing providers. This is understandable in a way, but it further reinforces the three-tier system in which a tenant’s entitlement to enhanced Housing Benefit is dependent on the legal identity of their landlord, which is patently bonkers as well as discriminatory:

  • Private supported housing landlord: Local Housing Allowance levels only
  • Nonregistered supported housing provider landlord: reduced levels of enhanced Housing Benefit
  • Registered provider supported housing landlord: full enhanced Housing Benefit

We actually need to get rid of the Exempt Accommodation rules and move to a supported housing rent based on an unrestricted Universal Credit housing component. This should be irrespective of the legal identity of the supported housing provider.

The Exempt Accommodation Project

Whilst we are stuck with the Exempt Accommodation rules, we’ve developed the exempt accommodation project in order to:

  • Stop financial discrimination based on the legal identity of a supported housing landlord
  • Enable local authorities to fully recover the enhanced Housing Benefit they pay
  • Ensure full regulatory compliance through the optional use of the ClouDigs cloud-based supported housing management system (it’s effectively free, so why not?)
  • Ensure that supported housing providers are of good quality and only operate with the consent of local statutory sector partners

The Exempt Accommodation Project works by connecting non-registered supported housing providers that own or lease their properties with smaller, community-based registered providers that then take a legal interest in the properties concerned. This enables the payment of enhanced Housing Benefit, which the local authority can fully recover. We provide all the necessary documentary infrastructure and regulatory compliance systems, and we calculate and secure the enhanced Housing Benefit. It effectively costs nothing as the small costs involved are Housing Benefit eligible.

Exempt Accommodation Project Flowchart

Exempt Accommodation Project Flowchart
Exempt Accommodation Project Flowchart

Please get in touch if you want to be part of the Exempt Accommodation Project, if you’re:

  • a supported housing provider, irrespective of legal identity, looking for enhanced Housing Benefit
  • a registered provider needing an additional revenue stream within a risk-managed structure
  • a local authority wanting a strategic approach to full subsidy recovery on enhanced Housing Benefit payments, and the effective management of the local supported housing market.

The Exempt Accommodation Project will not accommodate supported housing providers that are not welcome by the local authority within which they seek to operate. We conduct extensive due diligence on ALL supported housing providers (and registered providers) asking to be involved in the Exempt Accommodation Project. The first consideration the due diligence process is whether the supported housing provider in particular is “approved” by the local authority.

The Accreditation and Oversight of Supported Housing

It would be much simpler if supported housing providers were accredited by local authorities (not regulated or overseen, more on that in a minute). Why not simply refresh the old Supporting People accreditation framework? This would prevent the ill motivated people who set up poor quality supported housing providers and dubious registered providers as a moneymaking exercise from being able to claim enhanced Housing Benefit. Unaccredited providers should not be eligible to claim enhanced Housing Benefit. Thea Raisebeck’s “Exempt from Responsibility?” Report is an insight into the dangers of unaccredited providers.

The National Statement of Expectations requires local authorities to manage their local supported housing “market”, including supported housing services that they don’t fund, so-called non-commissioned services.

I think we need to clarify what we mean when we talk about “commissioned” and “non-commissioned” services. Both the National Statement of Expectation for Supported Housing and the abuse of the enhanced Housing Benefit system require us to do so.

In my view supported housing services should not be eligible for enhanced Housing Benefit or other funding unless they operate at the behest or with the approval of the local authority and its strategic partners.

Local authorities should actually accredit supported housing providers, whether or not they do so in a formal way. In this sense all enhanced Housing Benefit eligible supported housing services would effectively be “commissioned”. Commissioned with a capital C if they are recipients of local authority or other statutory funding aside from enhanced Housing Benefit and commissioned with a small c if they receive enhanced Housing Benefit only. The point is that the latter, which are erroneously referred to as “non-commissioned services”, should only be paid enhanced Housing Benefit if they operate at the behest of or with the approval of local authorities and are accredited by them. If they do this they should be regarded as commissioned services, albeit commissioned with a small c, as they do not receive local authority funding aside from enhanced Housing Benefit.

Accreditation is not regulation or oversight. It’s acceptance by a local authority that a provider operates strategically relevant supported housing that generates value[1].

As I have mentioned before, there is a multiplicity of regulators in the supported housing space: various national housing association/registered provider regulators, the Charity Commission, the CIC Regulator, the FCA none of which are specialists in supported housing.

For the most part supported housing is not overseen. The National Statement of Expectations doesn’t require local authorities to oversee supported housing, which is just as well as they are neither resourced and consequently skilled to do so.

I continue to argue for an independently developed and implemented supported housing oversight system with national scope and based on Value Generation principles. It should be developed by a university or think tank in consultation with the local authorities and providers but implemented independently. The outcomes it generates through formal oversight of supported housing should be fed back to local authorities and providers to inform funding and commissioning decisions and service improvement strategies.

The supported housing quality assessment system I propose (SHQAS) should be a Value Generation-based system. I defined the three value generation principles before and it’s important also to identify how these principles should be measured:

  1. Outcomes for people: qualitatively measured
  2. Cost benefit: quantitatively measured
  3. Wider social and community benefit: both qualitatively and quantitatively measured

The SHQAS should be funded by the UK and national governments. It shouldn’t cost providers and local authorities anything.

Conclusions

So, if you’re thinking about claiming enhanced Housing Benefit, be mindful of the fact that many local authorities are placing restrictions on the amounts they will pay and to whom.

Blanket approaches at restriction are exercises in cost control, not necessarily strategies to invest in supported housing providers that generate value and to restrict resources to those who don’t.

This means that there are many good supported housing providers, that don’t work with registered providers, that will have their revenue restricted. There are some not so good supported housing providers that work with registered providers (some of which are also questionable) which won’t have their revenue restricted.

The Exempt Accommodation Project is a means of rectifying this problem by matching good supported housing providers, which are “approved” by their local authorities, with good community-based registered providers.

In terms of how a local authority “approves” a supported housing provider I believe it should do so via a local accreditation process. No need to reinvent the wheel here: this is what local authorities used to do in the days of “Supporting People”. Bring out the old Supporting People accreditation framework, dust it down and update it for use today.

I don’t believe that local authorities are resourced or skilled to oversee supported housing, and in any event, we need to separate oversight on the one hand from commissioning and funding on the other. Hence, I have argued that a system for the oversight of supported housing, with national scope, should be developed by an independent agency such as a university or think tank and then implemented by that agency independently of both local authorities and supported housing providers. Clearly, the outcomes of the oversight process, which must be based on Value Generation principles, should be shared with both local authorities and providers to inform commissioning/funding decisions and service outcomes.

Michael Patterson

August 2021

[1] Value Generation is: outcomes for people (who live in supported housing); cost benefit to the public purse & wider social and community benefit.

Categories
Uncategorized

Why are some local authorities restricting enhanced Housing Benefit payments to charities & voluntary agency supported housing providers and/or forcing them to apply to become registered providers?

Introduction

Some months ago, I published a briefing on the National Statement of Expectations for Supported Housing and predicted, amongst other things, that it might tempt some local authorities to try and restrict the amounts of Enhanced Housing Benefit payable to supported housing providers, and also to try and limit the number of supported housing providers setting up new services.

In respect of the latter point it certainly the case that local authority should commission[1] supported housing that reflects well researched local priorities, and consequently not commission supported housing that doesn’t do so. In addition, local authorities should not commission supported housing that doesn’t generate value[2]. There are too many wrongly motivated people trying to make a quick buck from public money, and we need to see the back of them.

New Developments

In respect of the former point (i.e. restricting Enhanced Housing Benefit) we are beginning to see disappointing examples of some local authorities imposing blanket restricted Enhanced Housing Benefit levels on non-registered provider supported housing (i.e., voluntary organisations and charities). This has nothing to do with matching resources to needs. It’s just crude cost control being exercised at the expense of supported housing and the people it houses and supports. It means that people in non-registered provider supported housing will suffer lower levels of staffing, services and maintenance whilst people with the same additional needs in registered provider owned supported housing generally won’t. This is an iniquitous situation in which peoples’ entitlements to proper levels of service depend on the legal identity of their landlord, which is absurd. This situation must and will be challenged.

The reason that some local authorities are doing this is because they can only fully recover from the Department of Work and Pensions, the Enhanced Housing Benefit they pay when the landlord is a registered provider[3]. However, that is not a justification for discriminating against supported housing providers and residents simply because their landlord isn’t a registered provider.

We have seen other examples where local authorities insist that non-registered provider supported housing providers must apply to become registered providers as a condition of being eligible to be commissioned as local supported housing providers via framework agreements and other mechanisms.

This is for the same reason as that which “justifies” the blanket implementation at local level of restricted Enhanced Housing Benefit payments at well below the amounts paid to registered provider supported housing providers. Some local authorities don’t want to lose subsidy on non-registered provider supported housing providers no matter how much value those providers generate and no matter how important their services are.

There may be good reasons for some supported housing providers to apply to the Regulator for registration but enabling a local authority to fully recover Enhanced Housing Benefit subsidy isn’t one of them. I assume that the various UK housing regulators (Housing Benefit being a non-devolved issue) will have a view on this? The English Regulator of Social Housing in particular is currently very cautious about applications for registered provider status from supported housing providers. Did English local authorities talk to the Regulator of Social Housing before putting in place these requirements for registration as a condition of being commissioned locally?

I do understand that local authorities don’t want to lose subsidy as a consequence of regulations that treat different supported housing providers differently depending on whether or not they are registered providers. I don’t understand why those local authorities would choose to reinforce that difference by imposing blanket artificial Enhanced Housing Benefit maxima on non-registered providers and/or insist that such providers become registered providers. This is a myopic exercise in cost control that does nothing to support the development of good quality supported housing and does much to prejudice it.

A Solution

We actually need a wholesale redesign of the system for funding supported housing (see my blog post on this from 2020: https://supportedhousing.blog/2020/06/03/funding-supported-housing) but the wheels of state turn slowly and until we get structural change we need to tinker with the existing system. There is a shorter-term solution to this problem that would enable local authorities to recover the Enhanced Housing Benefit they pay in full without trying to force providers down the road of registration or restricting providers to unsatisfactory local Enhanced Housing Benefit maxima. Notwithstanding the fact that the Regulator of Social Housing is likely to rebuff applications for registration made purely on the basis that local authorities need to fully recover Enhanced Housing Benefit.

Please see The Exempt Accommodation Project homepage for more information about the solutions to this problem, then read on below.

Non-registered provider supported housing providers that own or lease their properties should consider leasing such properties to willing registered providers. Typical registered provider/agency relationships are based on arrangements where the registered provider owns the properties and the Management Agreement between the parties reflects that. However, where the provider agency has the legal interest in the property (it owns it or holds the head lease) the Management Agreement should reflect this fact. The Registered provider’s role here is to facilitate the ability of local authorities to fully recover the Enhanced Housing Benefit they pay, to ensure the properties concerned are up to the standards expected by the Regulator and to ensure that occupancy agreements are properly administered.

Aside from that, the provider agency can do everything else, including setting the rents and providing the maintenance services. It might want to subcontract maintenance, for example, to the registered provider on an “actual costs” basis but it shouldn’t have to, especially if it has previously maintained its own buildings.

The registered provider in such an arrangement would be paid an admin fee (say £20-£25) per tenant/licensee per week, which is claimable via Enhanced Housing Benefit. This might not be of interest to larger registered providers that have bigger fish to fry (although it might be). What I have in mind are smaller, community-based registered providers that would benefit from what could be quite significant levels of additional revenue. If a non-registered provider leased 50 units of supported housing to a registered provider with an admin fee of £25 per unit per week, that equates to £65,000 per year.

Please get in touch

So, this blog post is an appeal to non-registered providers and community-based registered providers to think about this. We have developed a lease model and a Management Agreement model to reflect these arrangements, so no one is going to have to reinvent the wheel. Furthermore, we can handle the revised Enhanced Housing Benefit claims to include the admin fee.

We have plenty of non-registered provider supported housing providers looking for willing registered providers, although we would happily talk to more. What we don’t have are the willing registered providers in sufficient numbers and locations so we are especially interested in hearing from registered providers who may have an interest in this, as well as providers looking for registered provider partners: michael@michaelpatterson.co.uk.

[1] To “commission” a supported housing service doesn’t necessarily mean to fund it as well in this context. It means to approve and/or recognise it as meeting assessed local need.

[2] Value Generation has 3 principles: outcomes for people; cost benefit & wider social/community benefit.

[3] If the landlord is not a registered provider (i.e. a voluntary agency or a charity) the local authority can only recover 60% of the difference between the appropriate Local Housing Allowance rate & the actual rent being charged.

Categories
Training Events

Intensive Housing Management, the National Statement of Expectations & the Supported Housing (Regulation) Bill

Supported Housing under a Magnifying Glass

A free Zoom event scheduled for 22nd April 2021 at 10am presented by Michael Patterson and Danny Key, two of the UK’s foremost experts in supported housing policy and finance.

This event will be for a duration of 90 minutes – 2 hours depending on the volume of questions from attendees, who will be provided with the presentation including links to relevant resources.

Context

Back in 2005 the Supporting People initiative was retrenching and supported housing providers needed a way to offset some of the consequent loss of funding. Danny Key had identified a refunding model based on the Exempt Accommodation rules and Housing Benefit regulations (enhanced Housing Benefit). Michael Patterson reintroduced the term ‘Intensive Housing Management’ to describe what it funded and set about promoting it to supported housing providers. The rest is history.

Enhanced Housing Benefit for Intensive Housing Management is now a revenue stream upon which the supported housing sector depends. It has survived the introduction of Universal Credit & UK Government policy changes. However, poor regulation and a lack of oversight of supported housing has led to some individuals and providers seriously abusing the system to the detriment of everyone except themselves. This has infomed the development of the National Statement of Expectations for Supported Housing and led directly to the Supported Housing (Regulation) Bill.

This event looks at:

  1. Enhanced Housing Benefit for Intensive Housing Management & Maintenance funding: what is it, who can claim it and how?
  2. What impact does the National Statement of Expectations for Supported Housing have on Enhanced Housing Benefit and supported housing in a wider context?
  3. What does the Supported Housing (Regulation) Bill mean for supported housing in general and for Enhanced Housing Benefit?

If you would like to participate in this event please email us with the words “event booking” in the subject line. We will confirm your participation by replying with a link to the Zoom event and a passcode.

If you would like advice on Enhanced Housing Benefit/Intensive Housing Management or any other aspect of supported housing please email us with the words “consultancy inquiry” in the subject line.

Michael Patterson is the author of the Supported Housing Blog and was responsible for reintroducing the terms “Intensive Housing Management” and “Tenancy Sustainment” to the supported housing sector and is currently promoting Value Generation as a means of measuring the quality of supported housing. Michael is available for consultancy assignments on any aspect of supported housing and specialises in revenue and capital finance and supported housing policy. Michael works with Danny Key on Enhanced Housing Benefit projects.

You can subscribe to the Supported Housing Blog by clicking this link.

You can contact Michael by emailing him on michael@michaelpatterson.co.uk or calling 0800 002 9467.

Please share this blog post with anyone you know who has an interest in supported housing, health & social care.

Supported Housing under a Magnifying Glass

Categories
Policy

The National Statement of Expectations for Supported Housing

Supported Housing Header
The oversight of supported housing

Introduction

It has been five years since the 2015 Comprehensive Spending Review suggested changes to the regulation and oversight of supported housing. The National Statement of Expectations for Supported Housing published on 20th October 2020 is an underwhelming development after this five year wait, albeit that the 2018 decision to continue funding supported housing from the welfare system, rather than a local authority commissioned funding model to top up Local Housing Allowance rates of Housing Benefit, was a welcome hiatus.

We knew that MHCLG and DWP were going to focus on:

  • Controlling Housing Benefit costs
  • Exploring sector led accreditation and benchmarking for supported housing
  • Identifying local authorities’ strategic planning frameworks for supported housing, resulting initially in the draft National Statement of Expectations published in 2017 as part of the “Funding Supported Housing” consultation and policy statement.
  • Examining enhanced regulation for supported housing

Publication of the National Statement of Expectations for Supported Housing is well overdue after having been flagged up as a UK Government intention over two years ago as part of the “Funding Supported Housing” proposals of 2018 and the draft National Statement of Expectations of 2017.

Added to that is the increasingly urgent and understandably strident tone of various parties demanding that supported housing, or at least the “exempt accommodation sector” should be regulated. Thea Raisbeck’s important “Exempt From Responsibility?” report focusses on this and more.

I agree. I have said so often, for example, my blog post of June 2020. For me, any regulatory and oversight frameworks for supported housing have to be based on Value Generation principles:

  • Outcomes for people
  • Cost benefit
  • Wider social and community benefit

Regulation and Oversight

Regulation should apply to how an organisation is structured, managed and financed. Oversight, in contrast, should apply to what it does, in this case the delivery of supported housing.

There is already a multiplicity of regulators in the supported housing sector, none of which in my opinion has a complete grasp of the nature of supported housing. There are also many supported housing providers that are entirely unregulated. Add to that the vexed question of who oversees what supported housing does, regulated or not?

The National Statement of Expectations for Supported Housing is not about regulation, it’s about oversight. It’s not about many of the services provided to people in supported housing, it’s about the accommodation itself and tenancy related services, the latter being Intensive Housing Management funded by enhanced Housing Benefit.

It’s also “guidance”. It relies on the statutory sector for its implementation and without additional funding it will have very little meaningful impact on how supported housing is overseen. This is a missed opportunity.

Having made clear that this Statement of Expectations is about oversight not regulation, it then makes clear that it’s about the oversight of supported housing accommodation not supported housing services. To be frank, it’s not really about oversight at all. It should oversee what supported housing does and how, not just where it does it.

Jurisdictional Scope

The National Statement of Expectations for Supported Housing doesn’t make clear to whom it applies in UK jurisdictional terms. It’s a UK Government document but to the extent it mentions regulators it only mentions English regulators. The Housing Benefit about which it talks a lot is a non-devolved function. So, is this England only or is it, at least in part, UK wide? At least one of the examples of good practice used is from a Scottish housing provider.

Analysis

When a policy pronouncement of this potential significance is made, I would usually undertake a line by line analysis. I did begin to, but rapidly came to the conclusion that you’d lose the will to live after the nth vague exhortation by UK Government that local authorities should be “encouraged” to do stuff that was originally set out in the draft National Statement of Expectations of 2017.

I have therefore tried to summarise the UK Government’s “wish list” and to contextualise it by referring to what might have been.

The National statement of Expectations for Supported Housing is divided into two main sections:

  1. Assessing local need and planning effectively to meet demand
  2. Delivering accommodation which is safe, good quality and value for money

Assessing local need and planning effectively to meet demand

The National Statement of Expectations for Supported Housing says that there should be collaboration between statutory sector agencies, including revenues and benefits teams, which should enable us to see that this is partly about controlling Housing Benefit costs in the specified/exempt accommodation sector.

I entirely agree that providers should collaborate with local authorities in the development of new supported housing. There are too many entirely unregulated supported housing providers setting up independently of commissioners and then applying for enhanced Housing Benefit.

Local authorities are “encouraged” to

  • Implement oversight arrangements
  • Undertake accommodation needs assessments
  • Map supply against current and future demands (as per the 2017 draft National Statement of Expectations)
  • Identify additional funding requirements.

Local authorities are not being given new money to do this and it isn’t a statutory requirement it’s just guidance, so there are no prizes for guessing what the likely upshot of this will be.

Providers of supported housing are exhorted to ensure safe and good quality housing, including the use of “the most secure form of tenancy/licence compatible with the purpose of the supported housing”.

Local authorities should ensure “value for money” by sharing data and benchmarking within and across local authority boundaries. Maybe you’ll forgive me for hoping that this is more about generating value (see the definition of Value Generation in the Introduction) than just crudely controlling costs, which often achieves the opposite effect. Restricting investment in prevention simply causes more human suffering and the much higher costs of subsequent, and otherwise avoidable, statutory health, social care and criminal justice interventions.

The National Statement of Expectations for Supported Housing is right to say that enhanced Housing Benefit claims should be no higher than the cost of providing eligible services that people need, but the likely outcome of what may be chalk and cheese comparisons of different supported housing services to establish local benchmarks may simply be to restrict the amounts payable on the basis of false comparisons. In other words, it may well be more about controlling costs than meeting peoples’ needs or generating value.

The National Statement of Expectation for Supported Housing provides a comprehensive list of (English) statutory and other agencies which should be involved in assessing needs and planning supported housing. It refers to the National Planning Policy Framework (which applies to England only, by the way) and makes reference to the need for “cross authority arrangements”. The latter have been with us in spirit but alas, rarely in physical form since the days of Supporting People.

Delivering accommodation, which is safe, good quality and value for money

The National Standards of Expectations for Supported Housing document refers to a checklist of existing legal requirements and suggested standards for accommodation and “tenancy related housing services” (presumably a reference to Intensive Housing Management funded by enhanced Housing Benefit). These are in Annexes A and B of the document.

Rather predictably much of the focus on “oversight” is around controlling Housing Benefit costs. I’m very much in favour of ensuring that enhanced Housing Benefit is paid at a rate equivalent to the reasonable costs of providing Housing Benefit eligible services that supported housing residents need. To do so is a good investment in prevention and enablement. I am not in favour of reducing enhanced Housing Benefit payments down to artificial maxima established on the basis of false comparisons between different supported housing services as a means of cost control. I’m also bitterly opposed to paying any Housing Benefit whatsoever to contrived supported housing arrangements set up by ill-motivated people to milk the system at the expense of people with additional needs and of the public purse.

I return again to the notion of Value Generation. Sometimes the enhanced Housing Benefit costs of supported housing seem high, whether it’s paid to Specialised Supported Housing (see page 4 of the hyperlinked document for a definition) or other forms of supported and sheltered housing. However, other services for people with additional needs are often far more expensive, and if supported housing generates value:

  • Outcomes for people
  • Cost benefit (to the public purse)
  • Wider social and community benefit

then enhanced Housing Benefit, which equates to what it reasonably costs to provide eligible services, generates a lot of value as well. To use the National Statement of Expectations for Supported Housing to artificially suppress enhanced Housing Benefit entitlements would be a myopic mistake.

The exhortation within the National Statement of Expectations for Supported Housing for commissioners and revenues and benefits departments to work together is both welcome and overdue. I am familiar with too many examples where commissioners give strategic support to a supported housing service (even if they’re not funding it) but revenues and benefits departments refuse enhanced Housing Benefit payments. This is most frequently because they can’t fully recover the amount of the proposed charge from the DWP, which is jointly responsible for the National Statement of Expectations for Supported Housing by the way.

In addition, I’m familiar with so-called supported housing services that are awarded enhanced Housing Benefit by revenues and benefits departments, even though these services are set up without reference to commissioners. Mercifully, this situation is increasingly less common now.

As I said in my introduction to this briefing, the UK Government was thinking about sector led benchmarking and accreditation schemes. My own view is that oversight should be conducted by an externally developed framework for accreditation and quality, based on Value Generation principles. In my “Oversight of Supported Housing” blog post I set out the basis for such a system, to be developed by a University or think tank and implemented by the same agency independently of commissioners/funders and providers, although they would inform its shape and nature according to Value Generation principles. The measurement of the value of supported housing must be independent of the people who fund and provide it.

The National Statement of Expectations for Supported Housing proposes a Supported Housing Sector Scorecard, an initiative apparently being led by the National Housing Federation but about which there is little in the public domain. Its development has been delayed for understandable pandemic-related reasons. What is less understandable is the apparent lack of openness about its development, with organisations simply being asked to email the coordinating agency to participate.

It’s based on the more general Sector Scorecard for social housing, the vast bulk of the reports from which are quantitative not qualitative. For supported housing in particular, qualitative data really matters because how people feel about supported housing can often not be measured in quantitative terms, neither can much of its wider social and community benefit. Forgive me for reminding you again of the three Value Generation principles:

  • Outcomes for people
  • Cost benefit (to the public purse)
  • Wider social and community benefit

Of these three the first and the third principles need to be measured qualitatively lest we become preoccupied with the cost of everything and the value of nothing.

Conclusions

The National Statement of Expectations for Supported Housing has been a long time in the making. It hasn’t changed that much from the draft National Statement of Expectations of 2017 and is disappointing in its scope.

Its focus is on the oversight of the buildings in which supported housing is provided and on “tenancy-related services” only (presumably another term for Intensive Housing Management). It doesn’t concern itself with regulation.

Existing regulators in the sector have neither the scope not the expertise to regulate what supported housing does nor the mandate to oversee it. Given the extent of additional need that supported and sheltered housing is now expected to meet we’ve been let down here. Much of what the sector does will remain inadequately overseen and unregulated.

It seems to me that the primary thrust of the National Statement of Expectations for Supported Housing is the control of enhanced Housing Benefit expenditure. It is certainly true that we should be very careful about who is paid enhanced Housing Benefit. That is a very different thing from artificially restricting such payments to genuine, value generating supported housing providers. We have an opportunity and a necessity to separate the supported housing sheep from the goats and the National Statement of Expectations for Supported Housing manifestly fails to help us do this.

To the extent to which the National Statement of Expectations for Supported Housing identifies useful things, for example, coordination between revenues and benefits teams and commissioners, wider involvement of other statutory agencies, strategic planning and the mapping of supply and demand for supported housing, it does nothing to enable these things. It’s only guidance and provides no new funding for implementation and as such it’s a recipe for inaction save for the focus on restricting enhanced Housing Benefit.

The framework for the oversight of supported housing should be developed and implemented independently of commissioners and providers, albeit with the latter’s significant input. There has to be a separation between the measurement of quality on the one hand and the funding and delivery of supported housing on the other.

Moreover, the oversight of supported housing should be conducted according to Value Generation principles, which have their own internal cost/quality checks and balances.

Michael Patterson

October 2020